Money in the Banks

 | Dec 02, 2013 | 2:55 PM EST
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It took a while but I can see it happening on our screens right now. I'm talking about how banks are at last trading in lockstep with the higher interest rates that make them so profitable.

This little blip up in rates, taking the 10-year note to 2.8%, is not being accompanied by any give at all in the CD market. In fact, rates have been unchanged, which is just money in the bank for the banks.

The big banks are celebrating what looks to be the end of the aggressive prosecutions and some deals that don't seem too onerous for the banks, like the Bank of America (BAC) deal announced to settle all remaining claims with Freddie Mac. The mid-sized and smaller banks are enjoying a better climate for construction loans, where the big money is.

And everyone loves the bountiful CD five- and 10-year spreads. The brokers are perceived as being able to make money on this curve and they've been strong, too.

It's a terrific time to be a banker and the market's getting it -- at last.

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